Facing a stalled domestic agenda and a slumping approval rating, President Biden needs to accomplish two goals with his State of the Union address on Tuesday.
First, given the failure of his Build Back Better agenda after months of unsuccessful negotiations, Biden should use the speech as an opportunity to propose a practical agenda for his second year, and to show Americans that his administration is focusing on what it can get done, rather than what it can’t.
Second, Biden needs to prove that he and his party can provide the conciliatory, bipartisan and forward-looking leadership that America needs right now. The president should explicitly pledge to make a more meaningful effort to work across the aisle on key issues, while also calling on Democrats and Republicans in Congress to work together on matters where compromise is feasible.
Though pledging to find common ground may seem like a futile promise in today’s politically-charged climate, it is indeed possible. Last year, an essential and long-overdue reform designed to modernize America’s infrastructure was signed into law by Biden, having received the support of dozens of congressional Republicans and nearly all Democrats.
Thus, when Biden outlines his second-year priorities in his State of the Union address, the president should not only call on both parties to work together but also should identify an issue of great importance to Americans where bipartisan compromise is possible — namely, lowering drug prices.
A majority (61 percent) of Americans — including 69 percent of Democrats and 53 percent of Republicans — say that reducing health care costs, which includes the cost of prescription drugs, should be a top priority for the president and Congress to address this year, according to a recent Pew Research Center poll.
To that end, a strong majority (83 percent) of Americans believe that the cost of prescription drugs is unreasonable, and about 3 in 10 Americans say they haven’t taken their medications as prescribed in the last 12 months due to the cost, per an October KFF poll.
To be sure, there is an important political opportunity here for Biden. By endorsing a concrete plan that would significantly reduce the overall cost of living for millions of Americans — by lowering the prices of prescription drugs they take every day — the president can help alleviate one of his biggest political vulnerabilities: high inflation, which has forced Americans to pay much higher prices for everyday goods and services.
That being said, rather than engaging in broad rhetoric about the need to lower health care costs, Biden should promote targeted and obvious solutions that will be both practically effective and politically viable, such as drug pricing rebate reforms.
The current structure of the prescription drug supply chain is fundamentally unfair to average Americans, especially to seniors and those with underlying health conditions.
In the present system, pharmacy benefit managers (PBMs) operate as middlemen, and they work primarily for insurance providers or retail pharmacies. When they negotiate with drug companies to distribute their products, they often receive partial refunds, known as rebates. In recent years, pharmacy benefit managers have been upcharging patients and holding onto these rebates instead of passing them on to consumers.
This lack of transparency in the system has left Americans paying outrageously high prices for their medications — leaving some unable to afford them entirely. The problem has gotten even worse just this year: At the beginning of 2022, prices on more than 450 prescription medications increased by an average of 5 percent, according to reporting by Stat.
In the private sector, billionaire investor Mark Cuban launched an online pharmacy that offers more than 100 generic drugs at affordable prices. His venture does essentially what a new piece of legislation should do: It cuts out the middlemen in drug pricing to make drugs more affordable.
For both political and practical reasons, Biden should use his State of the Union address to call on Congress to pass legislation to this effect, stating that rebates must be passed onto consumers, emphasizing how this would tangibly lower drug prices for millions of Americans and drive down their day-to-day cost of living.
And given that Trump’s goal of passing similar drug pricing legislation eluded him while in office, there is evidently a window for Biden to approach the issue in a bipartisan way.
Importantly, this policy would cut costs for Americans, while still allowing the pharmaceutical industry to innovate. In 2020 and 2021, pharmaceutical companies produced lifesaving COVID-19 vaccines in record time, and the best way to support that type of innovation going forward — while still lowering costs for consumers — is through policies like rebate reforms.
Ultimately, lowering drug prices is an issue that Democrats and Republicans can indeed coalesce around. This legislation is practical and long overdue, and by supporting it, representatives on both sides can gain politically based on the significant financial burden it would alleviate for millions of Americans.
Douglas E. Schoen is a political consultant who served as an adviser to former President Clinton and to the 2020 presidential campaign of Michael Bloomberg. He is the author of “The End of Democracy? Russia and China on the Rise and America in Retreat.”